Intellectual Property Strategy

Copyright remedies confirmed for open source agreements

Recently the United States Court of Appeals for the Federal Circuit handed down an important decision regarding the enforceability of open software licences (in ROBERT JACOBSEN v. MATTHEW KATZER and KAMIND ASSOCIATES, INC.)

At first instance, the United States Northern District Court of California held that breach of the licence agreement was just that – breach of the agreement. However on appeal, the court held that the structural elements of an “open software” licence were so fundamental to the licence itself that conduct outside the scope of the licence was in fact copyright infringement. As a consequence, remedies were available for breach of copyright (statutory damages), not just breach of contract (contractual damages).

The decision doesn’t create new law (it’s based on the old and well established difference between “covenants” and “conditions”). But it’s a good reminder that traditional legal concepts underpin the structural elements of an “open software” licence.

While the decision is being reported as a significant win, it’s really too early to make that claim for everyone. On one hand, “open software” communities have always struggled with the enforceability of their licence agreements. Often and for a number of reasons (both legal and financial) open software communities rely on social pressure to enforce licence terms. Confirmation that copyright remedies are available is a significant win as statutory damages don’t require proof of actual loss. On the other hand, the decision has a number of other flow on consequences. For example, now all downstream users of such infringing “open software” could also be liable for copyright infringement.

Does the positive impact of this decision outweigh any additional risks for users of “open source” software?